Identifying A Black Swan Event
Based on the author's criteria:
- The event is a surprise (to the observer).
- The event has a major effect.
- After the first recorded instance of the event, it is rationalized by hindsight, as if it could have been expected; that is, the relevant data were available but unaccounted for in risk mitigation programs. The same is true for the personal perception by individuals.
An example Taleb uses to explain his theory is the events of September 11, 2001. 9/11 was a shock to many observers. Its ramifications continue to be felt in many ways: increased levels of government control; "preventive" strikes or wars by Western governments. The coordinated, successful attack on the World Trade Center and The Pentagon using commercial airliners was virtually unthinkable to many at the time. However, with the benefit of hindsight, it has come to be seen as a predictable incident in the context of the changes in terrorist tactics.
Read more about this topic: Black Swan Theory
Famous quotes containing the words identifying, black, swan and/or event:
“And the serial continues:
Pain, expiation, delight, more pain,
A frieze that lengthens continually, in the lucky way
Friezes do, and no plot is produced,
Nothing you could hang an identifying question on.”
—John Ashbery (b. 1927)
“This is the end, the redemption from Wilderness, way for the
Wonderer, House sought for All, black handkerchief washed clean by
weeping—page beyond Psalm—Last change of mine and Naomi—to Gods perfect Darkness—Death, stay thy phantoms!”
—Allen Ginsberg (b. 1926)
“The Teutons have been singing the swan song ever since they entered the ranks of history. They have always confounded truth with death.”
—Henry Miller (1891–1980)
“My father, whose way was to force every event in nature into an hypothesis, by which means never man crucified TRUTH at the rate he did.”
—Laurence Sterne (1713–1768)